App Promotion Strategy

How to monetize mobile apps

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Table of Contents

1. What are the benefits to incorporating ads into my apps?

Mobile app users – and particularly gamers – have an increasing expectation that apps are free. “Fine,” you say, “I’ll use in-app purchases to make money.” Well, not all users are willing to make in-app purchases. Generally speaking, having an IAP conversion rate of 2-3 percent is considered pretty good.

So what about the other 97-ish percent? Advertising allows you to keep your app free, while still earning money even if  users never make in-app purchases. Depending on what type of app you have, the percentage of your revenue ads could potentially make up varies from incremental revenue to the majority of your income.

2. All right, I want to start monetizing, what’s next?

There are a couple of things that need to be in place before you can start monetizing with advertising.

First, choose an ad mediation platform, such as MoPub. This service allows you to manage and optimize your advertising demand and handles the selection of the best bid for each ad impression.

Next, determine which ad networks you want to include. Typically, an app that is monetizing successfully with advertising uses a handful of ad networks, such as AdColony (now a part of Digital Turbine). This is because each network has different direct advertisers and programmatic relationships, and only some of them will be interested in advertising in your app at any given time. The more bids for an impression your mediator can mediate, the higher the potential revenue.

3. What are the most important things to keep in mind when setting up app monetization?

It should go without saying that the most important thing to keep in mind is the user.

Someone using a free app/game understands that the creator of that app needs to make money and they may be willing to trade some of their time watching ads in exchange for the app remaining free. But don’t abuse this by forcing too many ads, interrupting the flow of a game or displaying ads over the top of app content. If you’re going to show banner ads consider building in a fixed area within your app where they will show.

For video, find the places in your app/game where there is a natural transition between steps of a workflow or levels of a game. For example, when a character within a game dies or needs more coins for a power-up, you can offer to revive in exchange for viewing an ad (called a “rewarded” ad in this context). Also, do some research by downloading and using successful apps in your category to see how they have implemented ads.

4. How should I think about rollout and testing?

When testing the integration of your mediator and ad network SDKs, try to do things incrementally. First, complete testing of your mediator SDK integration before adding ad networks.

This way, you can isolate any issues caused by the introduction of the new SDKs. Some mediators and ad networks (including AdColony) also allow you to run in “test mode.” Using this mode, you can receive test ads to make sure things are working correctly end-to-end. With AdColony, we send “smart” test creatives that will inspect your app set-up to see if it is ready to display ads from our network. Any issues detected will be shown in the test ad on the screen.

Also, consider installing a crash detection SDK to report any problems users might encounter when viewing ads, or with your app in general. You can’t fix what you don’t know is broken.

If you’ve done a thorough job of testing, the rollout should go pretty smoothly. If you’re adding ads to an existing app that didn’t previously have ads, you may want to test user reaction. Ideally, you’d test among a random group of users to see if the ads affect them negatively, though think carefully about what this means. Would a small decrease in session time combined with a large increase in revenue be acceptable? What about a lower D30 retention rate, but longer session times? This is a determination only you can make.

Both the App Store and Google Play offer tools for this kind of user testing.

You can consider rolling out regionally by starting with smaller but similar geography to your main user base if you have enough users. For example, some publishers will release to users in Canada before releasing to their broader North American user base, and Australia and New Zealand have long proven popular as test audiences for Western Europe and North America.

5. What are the most important things to keep in mind when scaling app monetization?

Things to think about when you’re looking to scale include:

Geography – where are your users, and how strong is the advertising demand you’ll get from your ad networks. Your networks should be able to tell you how many ads they serve to users in a particular geographic region. If most of your users are in Asia/Pacific (APAC), but your networks are primarily serving North America, you’ll have trouble scaling up.

Content – Some content is hard to scale for advertising. Apps with explicit content or deals with age-specific content such as alcohol, tobacco, or real-money gambling can have difficulty finding enough advertisers willing to place an ad. Your app content may also only appeal to certain advertisers. For example, if you have a utility app for tracking fitness, you may not appeal to those advertising a casino game. To help in this regard, be sure your app store pages are detailed and up-to-date. Advertisers often use information from the app stores to determine if they want to place an ad in your app.

Denylist – Sometimes developers choose to block certain competitors or genres from advertising in their app. Although this can sometimes make sense, opening up your inventory to as many advertisers as possible will naturally increase competition and your overall eCPM. It’s a reality that a certain percentage of users will churn out eventually anyway, so it makes sense to capture revenue from churning users. Who knows, maybe they’ll come back with your next UA campaign in a different competitor!

Consider starting with the widest net possible and allowing advertisers to openly bid on your inventory so that you can rest assured that every impression is competitively priced.

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